Infant industry argument(redirected from Infant Industry Theory)
Infant industry argument
Argument that industries in the developing and emerging sectors of the economy need protection against international competition in order to establish themselves.
Copyright © 2012, Campbell R. Harvey. All Rights Reserved.
Infant Industry Argument
A policy position stating that new industries developing in a country need government protection. That is, the infant industry argument states that a government must subsidize these industries and/or protect them through tariffs. Proponents of this argument note that several East Asian tigers used this policy following World War II with a great deal of success. Critics maintain that these policies are capital intensive and not all states can afford them. It could also lead to retaliatory moves in countries to which a country seeks to export. See also: Import-substitution industrialization.
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